By Debbie Glover

Pontchartrain Newspapers

In Wednesday’s newspaper, the first five amendments to the Louisiana Constitution that will be on the ballot Nov. 6 were explained. Included here are amendment proposals six through nine.

The sixth proposed amendment to the Constitution does not really affect this area. It is a property tax exemption authority for New Iberia. The proposal states:

“Do you support an amendment to authorize the granting of ad valorem tax exemption contracts by the city of New Iberia for property annexed by the city of New Iberia for property annexed by the city after Jan. 1, 2013?”

A vote for, according to the Public Affairs Research Council, a non-political, non-partisan, non-profit research group, would mean New Iberia could grant city property tax exemptions to any property owners annexed into the city after Jan.1, 2013. This would give the city another tool to promote economic development.

A vote against would mean the city would be unable to grant such exemptions to property owners annexed into the city. The language is so broad the exemption program could apply to existing businesses that just want to be annexed and avoid city property taxes in addition to new businesses and undeveloped properties. There are no specific eligibility requirements for interested property owners.

The seventh proposed amendment is for membership of certain state boards and commissions. The amendment reads:

“Do you support an amendment, relative to the membership of constitutional boards and commissions that have members who are selected from congressional districts, to retain the existing number of members and to provide for implement of membership from reapportioned congressional districts by filling vacancies first from under-represented districts and then from the state at large?”

Currently, the membership of six constitutionally created boards and commissions is based in large part on Louisiana’s congressional districts. After the census, one district has been lost, decreasing the number from seven to six. As a result, the current membership process will no longer be valid. This affects the Board of Regents, the boards of supervisors for the University of Louisiana System, the Louisiana State University System and the Southern University System, as well as on the State Civil Service Commission and the State Police Commission.

A vote for would adjust the membership selection process for constitutionally created boards and commissions that have members selected based on the state’s congressional districts. After Jan. 1, 2013, vacancies would be filled first from a congressional district that either is under-represented or has no representation. After each congressional district has equal representation, at-large members could be appointed to fill out the total membership required under the Constitution.

A vote against, according to PAR, would leave the membership selection process for constitutionally created boards and commissions as it is now—based on a soon-to-be outdated number of congressional districts.

Proposed amendment eight affects property tax exemption for non-manufacturing businesses. It states:

“Do you support an amendment to authorize the granting of ad valorem tax exemption contracts by the Board of Commerce and Industry for businesses located in parishes which have chosen to participate in a program established for the granting of such contracts?”

Property owners in Louisiana are obligated to pay ad valorem taxes, which are taxes paid to local government entities based on the value of the property. Ad valorem taxes typically support schools, law enforcement, local government operations and other parish or municipal services. Under state law, certain property can be exempted from the tax. Eligible businesses under the current law include corporate headquarters, distribution center, data service centers, research and development operations and digital media or software development centers.

Businesses not currently eligible for exemption for ad valorem taxes include retail sales, real estate, professional services, natural resource extraction or exploration, financial services, venture capital funds and gambling and gaming.

A vote for extending the exemptions would allow the Board of Commerce and Industry to grant local property tax exemption contracts to a targeted group of non-manufacturing businesses in parishes that choose to participate in the program. A property tax exemption program for specific non-manufacturing businesses would help make Louisiana more attractive to those types of companies looking to locate or expand operations. The state would be in a better position to attract new business sectors to its economy. The program would build upon a well-established practice already in place for manufacturing establishments in Louisiana.

A vote against would mean those targeted non-manufacturing businesses would continue to be ineligible for property tax exemptions. Passage of the amendment would result in the possibility of yet another exemption to local property taxes, which ultimately hinders the ability of local governments to raise their own revenues and meet their needs. The first $10 million of assessed value or 10 percent of the fair market value (whichever is greater) would be taxed. Any value above that would be exempt. In addition, at least 50 percent of the business’s sales would have to be to out-of-state customers, or to in-state customers who resell the product out of state or to the federal government or some combination thereof.

A number of problems exist with this amendment, including the fact that some assessors are concerned this exemption would make it difficult for them to meet their constitutional mandate to establish uniformity in taxing properties across their districts. They fear they could be open to lawsuits from property owners who do not get the break.

Also, some of the targeted businesses might have located in Louisiana without the property tax exemption incentive. Granting the exemption means the loss of new revenue the parish might have taken in were it not for the incentive, PAR says.

Amendment nine that is proposed will affect crime prevention and security districts. The proposal asks:

“Do you support an amendment to provide that no law relative to the creation of a special district, the primary purpose of which includes aiding in crime prevention and security by providing for an increased presence of law enforcement personnel in the district or otherwise promoting and encouraging security in the district, shall be enacted unless three separate notices of the proposed law are published at least 30 days prior to introduction of the bill, which notices shall set forth the substance of the proposed law and whether the governing authority of the special district would be authorized to impose and collect a parcel fee within the district, whether the parcel fee will be imposed or may be increased without an election, and the maximum amount of such fee?”

Currently, crime prevention districts — also called security districts — have become increasingly popular in Louisiana. Through them neighborhood groups can collect a parcel fee — or tax — from every homeowner or property owner within a specific area and use the money to enhance crime prevention and security efforts.

A review of the section of the Constitution dealing with these districts by the Public Affairs Research Council showed that the first one was created in 1997 in New Orleans and was called the Lakeview Crime Prevention District. Since then, 29 more such districts have been established — 17 in Orleans Parish and 12 in East Baton Rouge Parish. Voters will decide on another eight proposed districts.

The amendment would increase the amount of public notice required for crime prevention and security district bills by requiring that the notice of intent to introduce such a bill be published on three separate days (rather than two) in the official journal for the area where the special district is to be located, according to PAR.

A vote for would increase the number of times that bills to create crime prevention and security districts must be advertised and require that the notices of intent state whether a parcel fee will be imposed and collected, whether the fee can be imposed or increased without an election, and what the maximum amount of the fee will be.

A vote against mean crime prevention and security district bills would continue to be subject to the same public notice requirements as they are now.